Mr. BURKE. My own construction is that our vessels, foreign and domestic, are excluded, but for the sake of argument, to consider it--

Senator WALSH. I understood the judge to say that he believed it did not apply to any of our vessels?

Mr. BURKE. Yes; that is my contention.

Senator WALSH. But, conceding, for the purpose of the discussion, that it did apply to vessels in the foreign trade, he argued that it did not apply to vessels in the coastwise trade.

Senator BRANDEGEE. I do not think either of you understood what I meant. I may have misspoke myself.

Senator WALSH. You lead us to believe

Senator BRANDE GEE. Therefore I am inclined to think that I misspoke myself. What I mean is that I understand the judge to say that when the Hay-Pauncefote treaty says "the canal shall be open to the vessels of commerce and of war of all nations observing these rules," that language only meant deep-sea vessels?

Mr. BURKE. No; what I meant to say was that that language only included the users of the canal. That the United States adopts these principles as a principle of neutralization, and is speaking to the rest of the world, and that those words, "vessels of commerce and of war," do not include vessels of any kind of the United States, of commerce or of war, and the really logical man was the man from Chicago, who has said the treaty would prevent us from fortifying the canal.

Senator BRANDEGEE. I still think, if you had your manuscript before you, I could point out the claim that you made that the construction put upon those words by Great Britain herself included any other vessels of commerce except overseas.

Mr. BURKE. You are quite right in that. I was showing that by the definition which for 100 years she had given in practice to those words that it did not include interstate-commerce vessels.

Senator BRANDEGEE. Or coastwise vessels ?

Mr. BURKE. Or coastwise vessels.

Senator BRANDEGEE. That is what I thought you meant.
Mr. BURKE. Yes; that is right.

Senator BRANDEGEE. Now, referring to that point, do you admit that under Article I of the treaty we can not discriminate against the British foreign trade?

Mr. BURKE. Certainly not. We have got to treat them as we do every other nation.

Senator BRANDEGEE. Supposing giving free tolls-that I regard as a contradiction in terms, but giving free passage to our coastwise shipping does result in a discrimination by us in the use of the canal against the British foreign trade?

Mr. BURKE. No; it does not.

Senator BRANDEGEE. I say, suppose it does?

Mr. BURKE. I can not suppose that.

Senator BRANDEGEE. Did you hear a witness who testified here this morning, who said he came on from Boston, and had a line of steamships with which, he said, if we charged tolls in the coastwise shipping he could not compete with the British foreign shipping from the British Provinces through the canal to Boston?

Mr. BURKE. Yes.

Senator BRANDEGEE. And that if he were exempted from tolls he could compete with them?

Mr. BURKE. Yes.

Senator BRANDEGEE. Why do you not think that would be a discrimination against the foreign trade of Great Britain?

Mr. BURKE. Because by the practice of Great Britain, by the practice of the United States, by the decisions of the Supreme Court that is not a discrimination. Discrimination means this-we misuse the word often: There can only be discrimination between two parties where one has the right and it is denied to him. Begging the question there. Discrimination means this: The denial to."A" in favor of somebody else of a right to which "A" is entitled.

Senator BRANDEGEE. We did not agree in this treaty, did we, not to discriminate against Great Britain in the laws which we passed excluding foreign vessels from our coastwise trade?

Mr. BURKE. I do not know that I quite understand you.

Senator BRANDEGEE. We did not agree in this treaty not to discriminate against Great Britain in any other respect except in the use of the canal and the charges, did we?

Mr. BURKE. There is nothing in the treaty except as to the use of the canal.

Senator BRANDEGEE. That is what I think; therefore I do not see the relevancy of your claim that inasmuch as we do not admit British vessels to our coastwise trade, therefore there is no discrimination against her if we give such an advantage to our coastwise trade as will conflict with their foreign trade.

Mr. BURKE. That is the practice of all nations and it is the decision of the Supreme Court in Olsen v. Smith, where it distinctly says it is no discrimination against the British Nation under a treaty in which the terms were quite as clear and strong as in this; in fact, I think

more so.

Senator BRANDEGEE. The case of Olsen v. Smith was not dealing with discriminations in the use of the canal?

Mr. BURKE. No, sir.

Senator BRANDEGEE. And was not construing rule 1 of Article III of the Hay-Pauncefote treaty?

Mr. BURKE. That is true.

Senator BRANDEGEE. This rule 1 goes further and states:

So that there shall be no discrimination against any nation, or its citizens or subjects, in respect of the conditions or charges of traffic.

Mr. BURKE. But "nation" refers to the nations of the world, not to us.

Senator BRANDEGEE. I can not follow your argument if you take the stand that rule 1 of Article III does not bind the United States at all.

Mr. BURKE. I do say it does not.

Senator BRANDEGEE. And only binds other nations?
Mr. BURKE. That is what I do say.

Senator BRANDEGEE. But when you say it is not a discrimination; that it does not discriminate against a British vessel in the foreign trade going from Halifax to Boston through the canal, that we exempt our coastwise vessels going the same voyage, I can not follow you.

Mr. BURKE. Assuming, for the moment, that I am right in saying that the first provision or rule of Article III refers exclusively to foreign nations and not to oursleves, that they can have no concern, then what we do with our coastwise commerce

Senator BRANDEGEE. If you assume that the United States is not to be governed by any of these rules, but that the United States is left to hold the scales evenly as between foreign nations, of course I am not discussing that.

Mr. BURKE. That is my position.

Senator BRANDEGEE. That is another question at issue.

Mr. BURKE. Yes, that is the question right between us, and that is the question that has given you Senators all this trouble.

Senator OWEN. Your assumption carries the necessary conclusion, does it not, Judge?

Mr. BURKE. Yes, of course, I have to start out-I would not consider for a moment saying a word about it if I were not convicted in my mind that the United States made a declaration there to all the world. It means substantially this: As owners of the Panama Canal we say to all the world: "You shall have the right to use it upon equal terms, upon such conditions."

Senator OWEN. In other words, observing these rules?

Mr. BURKE. Yes.

Senator OWEN. Observing these rules is the point upon which you hang your argument, is it not?

Mr. BURKE. Yes, sir.

Senator OWEN. That those words exclude the United States?

Mr. BURKE. Yes; and I hang my argument there upon this general principle of international law to begin with. When we come to a treaty which is a little doubtful we always hark back to some fundamental principle. It is a well-settled principle of international law that where a nation builds and owns a canal, it is sovereign over the territory through which the canal runs, that nation may dictate the conditions upon which other nations may use that canal-you can not do it as to natural waterways, but as to artificial waterways. We start with that proposition. Then we have the United States in that position, and adopting a declaration, not jointly with Great Britain as in the first monstrosity, that first Hay-Pauncefote treaty, which was a monstrosity as bad as the Clayton-Bulwer treaty, and that was the most unfortunate engagement this country ever went into. They stand facing the world and say: "This canal which we have built and which we own and which cost us $400,000,000 and which we pledged the credit of the nation to safeguard-you shall have the free use of it on equal terms, obeying these conditions." That is my position.

Senator OWEN. Let me ask you a question. Article III of the first draft of the Hay-Pauncefote treaty contained the provision that other nations might be invited to adhere to that first draft of the Hay-Pauncefote treaty?

Mr. BURKE. Yes.

Senator OWEN. And it was struck out, very properly, by the United States Senate. The words "observing these rules were inserted, were they not, in lieu of Article III, as a means of committing those nations that enjoyed the use of the canal to the rules imposed by the United States, without giving them a contractual right?

Mr. BURKE. The history of that, as I understand it, is this (and I think you are pretty nearly right): The original draft was "agree to these rules." Somebody said "that brings those foreign nations into partnership, and might imply".

Senator OWEN. And does the same thing that Article III did in the first place?

Mr. BURKE. Precisely; you are right.

Senator OWEN. So, "observing these rules," was finally agreed upon as excluding Article III and preventing any nations having a contractual right?

Mr. BURKE. Yes, precisely.

Senator OWEN. And that was the real purpose of those words, was it not?

Mr. BURKE. Yes; I think very likely.

Senator OWEN. If that be true, if that was the purpose of those words, have you any right to construe those words as excluding the United States, which the first draft of the Hay-Pauncefote did not consider?

Mr. BURKE. It would make the treaty absurd if I did not. Do you mean to tell me that we are obliged to observe a rule that forbids us in time of war to blockade the adversaries' vessels coming through it? Senator OWEN. Oh, no.

Mr. BURKE. But that is one of the rules.

Senator OWEN. Oh, no; not at all. I do not wish to argue this with you, because I only want to ask you a question. I will argue it in my own time, and not in yours.

Mr. BURKE. That is all right.

Senator OWEN. What I was calling your attention to was that the words, "observing these rules," were inserted in lieu of Article III in the first draft and for the purpose of giving no contractual right to other nations.

Mr. BURKE. Those, or some similar words-whatever the moving cause was for putting them in at that time, was that they, or some similar words, were absolutely necessary in order to complete the sentence, the declaration of the United States. The United States is making a declaration of neutrality, of neutralization, as they called it, to all the world, which means that you shall have the use of this canal on equal terms by observing these rules. You know in the old Clayton-Bulwer treaty they reserved to Nicaragua, the owner, the territorial sovereign, the right to exclude all nations that would not come in and join the United States and Great Britain in fortifying it. Senator OWEN. There is no difference of opinion between you and myself regarding the sovereignty of the United States and the right of the United States in protection of its sovereignty to exclude the whole world from that canal.

Mr. BURKE. Then we are agreed.

Senator OWEN. But we are not agreed upon the interpretation you put upon these words "observing these rules," because when I asked you if the words "observing these rules," were not put into this first paragraph of Article III in lieu of Article III of the first draft of the Hay-Pauncefote treaty, you are obliged to say-if you know the history that that is true.

Mr. BURKE. That may be true, but it also serves the purposeSenator OWEN. Not only may be true, but it is true.

Mr. BURKE. Now, suppose it is

Senator OWEN. Suppose it is, then these words, which were put in there in lieu of Article III, which would invite the nations of the world to adhere, were put in for that purpose and were not put in for the purpose now attributed to these words, to exclude the United States from the list of nations referred to in the first draft of the HayPauncefote treaty, when the Secretary of State, when the President of the United States, when the Senate of the United States agreed to a draft which did not have these words at all, but which declared that this should be open to the citizens of all nations, and that term then included the United States, and the United States was only subsequently argued to be excluded by the injection of these three words, 'observing these rules."

Mr. BURKE. It may very well have been as a substitute for that omnibus third article in the first treaty, but it did not thereby include the United States by any means.

Senator OWEN. Then you are forced to argue that in the first draft of the treaty "all nations" did not include the United States?

Mr. BURKE. The first treaty included pretty nearly everything it ought not to have included, and for that reason it was thrown out. But, Senator, what I wanted to make plain to you is this, that my view is that the United States, standing as the owner of that canal, said, in effect, to the nations by "observing these rules," that those rules are of such a character that it is impossible that the United States could be included as one of those who should observe them, because it would have imperiled in time of war the integrity and safety of the country.

Senator OWEN. I will ask you this question, Judge. You could, perhaps, could you not, observe certain rules laid down in different ways?

Mr. BURKE. Certain rules in different ways?

Senator OWEN. That is to say, the United States, while sovereign and while requiring other nations to observe these rules, would itself observe these rules in compelling other nations to observe them. Not in the same way, but as sovereign?

Mr. BURKE. There are some of them it could not observe. There are times when if they did, it might imperil the national safety. And they are all of such a character that it almost makes a reducto ad absurdum of the treaty to say that the nation that was guaranteeing neutralization and stating the terms upon which the canal shall be neutral to all nations, should be talking about itself. It seems to me absolutely inconsistent. Now, I may be wrong. In fact it would not be the first time, and it may not be the last time.

Senator OWEN. And I shall have to join that category.

Mr. BURKE. In speaking with this kind of confidence I do not want you to feel that I believe that I know it all and that nobody else knows anything. But on this question the most eminent men in the country seem to be divided. The Supreme Court of the United States, according to my view, take the view I am trying to express here-Richard Olney and Asa B. Taylor. On the other side, Senator Root, a man of the greatest eminence a man of high character and great talents, takes the other view; and I may say to you here that it was not his eloquence and his ingenious reasoning that ever shook my faith for a moment, but when I was away last year for 10 months